Cars For Sale founder Sean Coffman and friends pose with a car sponsored by the company that raced in the Daytona 500. / Submitted photo

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Cars for Sale founder Sean Coffman speaks to employees in their office on South Carolyn Avenue. / Submitted image

Employees at Cars For Sale are given 30 seconds on their birthday to grab as much cash as they can in a money booth. Typical winnings range from $100 to $300. / Submitted photo

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This is the sort of company most people wouldn’t expect to find in Sioux Falls.

It started like something out of 1990s Silicon Valley lore. An idea-minded founder lands the right dot-com, and the business takes off. Employees wear jeans to work and play pool or foosball on breaks. Sales grow well into the double-digits annually. Hardly anyone quits.

That’s the story of Cars for Sale, a tech company that has grown to 170 employees with barely a blip of fanfare locally.

“I’ve always flown under the radar and not looked for public attention,” founder Sean Coffman said. “It’s not my goal to be in the public eye a lot.”

Instead Coffman quietly has developed his business into a major force in the online auto sales industry and amassed a growing staff as he offers jobs for programmers and IT professionals to customer service representatives.

“He’s not on anybody’s radar. I think it’s terribly unique, and I think that’s a great combination (of jobs),” said Mary Medema, director of workforce development for the Sioux Falls Development Foundation. “It’s the kind of company that a lot of folks would like to find and work for.”

Finding Cars for Sale, literally, is not easy. There’s a small sign but not much else marking the basic-looking building at 2707 S. Carolyn Ave. sandwiched in between hotels and construction-related businesses. The parking lot overflows because, less than three years after moving in, the business already has outgrown the building.

Inside, work areas are dedicated to programming, sales, customer service and IT. Monitors above the call center track sales from all over the country.

There soon might be more growth to broadcast. The company, now 15 years old, is entering the next phase in its evolution as it broadens into new tech ventures and innovations.

They are unique undertakings for this part of the country, but Coffman said he has never considered locating anywhere but the Sioux Falls area.

“It’s my roots. I live here,” he said. “I wasn’t out to build a business. I was just an entrepreneur trying different things and landed on it.”

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'Not a car guy'

A 1991 graduate of Beresford High School, Coffman describes himself as “one of the last people in the class you’d have called out to be a businessman.”

Although he dabbled in selling used cars in his teens and early 20s, he doesn’t consider himself a “car guy.” Nor are his roots in computer programming like some dot-com founders.

“I’m an idea guy,” he said. “I just keep thinking of ideas.”

In the 1990s, Coffman read about the growing value of Internet domain names. He bought 300 or 400 of them but kept coming back to carsforsale.com. Someone already owned it but eventually let it expire. At 3:30 a.m. one day in 1999, Coffman bought it.

“It’s a critical part,” he said of the domain’s value to his business.

A 1999 article in the information technology publication CIO agreed. Under the headline “The Name Game,” the publication listed car-related domains that had already been claimed – including carsforsale.com – and said there would be an inevitable shakeout among the auto online businesses.

There was, and Cars for Sale has emerged among the national leaders. Coffman, who built the initial website with his father, started by offering listings on it to dealers for free and cold-calling potential customers.

He phased in dealer pricing as the site grew, although individuals can list vehicles for free. Less than five years ago, he had about 1,000 dealers on the site. Then things took off.

“Now, we have about 16,500 dealers,” he said. “It’s not growing 50 percent a year anymore, but it’s still growing 30 to 40 percent a year. We expect to have 18,500 dealers by year end.”

Two million vehicles are listed on the site. That’s fewer than competitors Cars.com, which is partially owned by Gannett Co. Inc., parent company of the Sioux Falls Business Journal, and AutoTrader.com. But it’s growing fast.

“Our price structure is competitive, but the brand and the word of mouth has taken off for us,” Coffman said.

The company also has gained national visibility through television advertising during “Monday Night Football” and sponsorship of NASCAR Sprint Cup Series driver Landon Cassill, who raced in February’s Daytona 500. In addition, Cars for Sale has bought national radio advertising and ranks exceptionally well in search engines, Coffman said, primarily because of the domain name and strong search engine optimization.

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The outreach to car buyers appears to be paying off. The site receives 6 million visitors monthly, he said.

It all started on a much smaller scale. Coffman leased his first office in Tea. It was 1,100 square feet, and he said he didn’t expect to outgrow it. Next, he needed 3,400 square feet.

“And we blew through that,” he said.

John Lawler, mayor of Tea since 2002, was probably one of few people in the city who knew the company was there.

“They were very low profile,” he said. “They didn’t have signs or anything. The beauty of his business is he doesn’t need (that kind of) exposure. People can know where it’s at or they don’t have to.”

Lawler visited with Coffman over the years to learn more about the business.

“He’s very focused on his employees and doing the right thing for them, trying to give them a good career,” he said. “He seems to take care of his people. You look around his office with the pool tables and trying to create a fun atmosphere and keep it light, but serious, with a fun element.”

Practical jokes are part of the office culture, Coffman said. On their birthdays, employees are given 30 seconds in a money booth to grab as much cash as they can. He tries to create a family environment.

“For me, it’s God first, family second and work falls in there later,” he said. “It’s a work-hard, play-hard mentality where I show respect to employees.”

Corporate operations specialist Kara Meisinger started working for the company two years ago in customer service.

“I love it,” she said. “I wake up every day excited to come to work.”

Many of the employees are friends outside of work and support each other personally and professionally, she said. Community service is encouraged, and the staff volunteers together on projects.

“It’s not a typical office,” Meisinger said. “When I first came here for my interview, it was just so lively, and everyone was so welcoming. People want to get to know you on a personal level.”

The company likely has found talent through employee referrals, said Medema of the development foundation.

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“I think they have to find somebody who’s a fit for the culture,” she said. “You don’t always think about that … but they can’t lose sight of it if that’s important to them. And they’ve obviously done a good job to grow it to this point. I think that’s very admirable.”

Tech company broadens

The success of Cars for Sale also has led the company into new tech ventures. Coffman launched the website freeclassifieds.com in late 2011 as a competitor to Craig’s List.

“We’re becoming an innovative company,” he said. “I think the advantage with Free Classifieds is we can stand the test of time because we’re not dependent on revenue from that business.”

It gets 150,000 unique visitors a month with little advertising, he said. Some employees are dedicated to that site and more will be added as the business matures.

Coffman compares the site to where Cars for Sale was 10 years ago. He sees potential to grow revenue by offering business management solutions to small- and medium-sized businesses nationwide.

“From pet stores to hair salons, we’re getting into business technologies of all kinds,” he said. “We’ll build technologies that make sense for the hair salons … and would build you a website for your pet store.”

Another project in development is a social network called Thit. Coffman and his team have given away 100,000 T-shirts to people nationwide who registered to be the first to learn what Thit is.

While the concept is still in development, he has been thinking about it since the name popped into his head while still working in Tea and plans to launch initial applications later this year.

“I love the brand,” Coffman said. “It’s indescribable. The curiosity it imposes, the fact that you can’t define it, and to me it’s the blackest black and the whitest white and anything in between. I could do anything with it.”

He has no timeline but said the goal is “to do something big with it.” A few ideas already haven’t passed his scrutiny.

“I’ve had three or four ideas with Thit that I’ve taken three-fourths up the business process mentally and shut them down because they didn’t make sense or wouldn’t have the staying power,” he said. “I have no problem letting go of what was once thought to be a good idea.”

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Patent and plans

Maybe that’s because Coffman seems to have so many ideas. One came to him while using a golf simulator.

“And when it came to the putting surface, I was amazed nobody had a better surface,” he said.

So he came up with an idea for a moving floor within a golf simulator, hired a full-time engineer to work on the concept and paid to fast track a patent, which he received in late 2013.

“We moved fast on it,” Coffman said. “I think it’ll be interesting. It could revolutionize the golf simulator experience.”

Called Virtual Green, it’s driven by the same data that drives the current golf simulator experience. In addition, though, the data is communicated to the floor so the landscape changes between every shot.

“The contour of a golf course is by far the most important aspect of the game,” Coffman said. “There’s not too many flat spots on a golf course. As with many of my ideas, I was surprised to find nobody had done this.”

He’s working on fine-tuning prototypes and reducing costs before actively marketing the product.

The next stage in business growth for Coffman will be finding people to develop all of his ideas. He plans to establish a lab of beta testers as part of the 30 to 40 employees he expects to hire this year.

“Cars for Sale is evolving into a full-blown tech company,” he said. “We’re starting an … innovation team where their full-time job is working on projects for the future.”

The company’s future is bright, according to Craig Lloyd, CEO of Lloyd Cos., who met Coffman a few years ago when he leased him the Sioux Falls office.

“He’s engaging to me,” Lloyd said. “I could sit and listen to him for hours. His whole mindset goes the Google route. You don’t find businesses like that. He thinks out of the box.”

The next office expansion could take the company into anything from 50,000 to 200,000 square feet of space, Lloyd said.

“It just depends on where he wants to go. Midcontinent, Premier, they all started out that small,” he said. “All the side stuff he’s trying to do, a guy with his vision, he could be unbelievable.”

Coffman, who spent six months in college, said he’s largely self-taught and has learned from researching the stock market and seeing other businesses’ mistakes.

“Most of my success is probably treating people fairly and having mutual respect for people,” he said. “In business, I think everybody has to win. The customer has to win. My employees have to win. We all have to have a role in it.”

Coffman’s business card doesn’t list a title. But if it did, the words ideation and innovation would seem to belong there just as much as president and CEO.

“Craig’s List has been innovated. Facebook, Twitter, Groupon, Foursquare, Instagram,” he said. “I still think even though technology seems so advanced we’re still at its infancy.”